Royal Wessanen, the Dutch food group, has kept its forecasts for annual sales and earnings despite seeing half-year profits slide fall by more than 3%.
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The company, which has operations in the US, the UK and in Europe, said today (31 July) that operating profit slid by 3.6% to EUR26.7m (US$41.8m) during the first half of the year.
The fall in earnings came despite rising underlying sales in the second quarter of the year. On an organic basis, revenue rose 6.3% during the second quarter, although thanks to the strength of the euro, revenue dipped 0.7% on a reported basis to EUR389.1m.
Half-year sales were down 0.8% to EUR773.7m, Wessanen said.
CEO Ad Veenhof said all four of Wessanen’s operating units were enjoying sales growth above the company’s targets and explained a combination of one-off factors had weighed on earnings.
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By GlobalDataVeenhof cited rising fuel prices in the US, the weak sterling hitting Wessanen’s UK results, an increase in advertising expenditure and the integration of a convenience business in Europe had all hit profits.
However, he added: “Despite these events, which are not expected to recur, we maintain our growth and earnings forecasts for the year, based on solid sales growth and an improvement in the operating result in the second half of the year.”
